Prior Experience of Managers and Maladaptive Responses to Performance Feedback: Evidence from Mutual Funds
研究了美国共同基金经理的先前经验如何导致过度自信，进而影响其对负面绩效反馈的反应，发现经验更丰富、更专业的经理在面临低于预期的基金表现时，改变投资决策的幅度更小，且这种低响应性与未来更差的基金表现相关。
In this study, we examine how the prior experiences of decision makers systematically influence their assessment of and responses to negative performance feedback. We posit that, although greater and more specialized experiences enable managers to build relevant knowledge and expertise in specific domains, they also make them overconfident in their abilities and strategies. Such experience-induced overconfidence further leads to distortions in the performance assessment process, hindering a firm’s ability to recognize and respond to poor performance. We empirically test these arguments in the context of U.S. mutual fund managers making investment decisions in response to fund performance below aspirations. As hypothesized, we find that more experienced and more specialized fund managers change their investment decisions less when faced with negative performance feedback than managers who are less experienced and less specialized. In additional analyses, we further show that the lower responsiveness of more experienced (specialized) managers is associated with the fund’s lower future performance, supporting our proposed theoretical mechanism (overconfidence). This study augments existing performance feedback research by showing how decision makers’ prior experience can impede problem-solving behavior in organizations. It also contributes to the literature on human capital and organizational learning by documenting an unintended consequence of accumulated human capital on firm adaptive behavior. Funding: This work was supported by INSEAD research & development funds. Supplemental Material: The online appendix is available at https://doi.org/10.1287/orsc.2022.1605 .